What is Last Click Attribution and How Can SaaS Companies Use It?

Attribution helps SaaS companies identify which sales and marketing efforts result in a conversion. Doing so allows marketing, sales, lead gen, and other teams to identify the actions that drive conversion and revenue.

Additionally, with the help of attribution, SaaS teams can optimize budget allocation for various channels and campaigns to improve the conversion rate.

In this article, we’ll discuss the following

• What is Last Click Attribution
• How can SaaS companies use this model?
• The difference between Last Click and First Click Attribution models.
• The limitations of Last Click Attribution.
• How Last Click Attribution works in Factors

What Is Last Click Attribution

Last Click Attribution (LCA) model credits 100% of a conversion to the last touchpoint a buyer interacts with for a conversion event in the buyer’s journey.

Here’s an example to help you understand how LCA works.

Let’s say a CMO is looking for attribution software to help them tie their marketing team's efforts to conversions and revenue generated.

During market research, they come across a LinkedIn advert for Factors.ai and land on the features page and get insights into how the application can provide a solution to their needs.

Later that week the CMO comes across a blog talking about why CMOs should care about B2B Marketing Attribution. Upon reading this article, they finally decide to sign up for a demo.Last Click Attribution

Here the last touchpoint the CMO interacted with is the blog. So the LCA model will give full credit to the blog for the CMO’s conversion (demo sign up).

Last Click vs First Click Attribution: What’s the Difference?

First Click is another simple attribution model that is similar to Last Click. Both of these are single-click attribution models, they attribute conversion to a single touchpoint.

The key difference between the two models is that Last-Click attributes a conversion to the final touchpoint. Whereas First-Click gives credit to the first touchpoint that led to a conversion.

We will explain how First Click Attribution (FCA) works by using the same CMO’s demo sign-up example.

The differences between the two models are that

• LCA attributes the conversion to the last touchpoint before the sale whereas FCA Attributes the conversion to the first touchpoint in the customer's journey.
• LCA emphasizes the impact of the last touchpoint before the conversion while FCA measures  impact of the first touchpoint in the customer's journey.
• Last Click Attribution is easier to implement compared to FCA as it needs sophisticated software for comprehensive tracking and data collection.
• Last Click is commonly used in B2C businesses, B2B companies can also use it jointly with other attribution models. First Click on the other hand is commonly used in B2B businesses where the sales cycle is longer and consideration for purchase is high.

How Can SaaS Companies Use This Model?

Last Click Attribution is a cost-effective model that SaaS companies can use to identify and optimize various campaigns and channels driving conversions. LCA is available for free on Google Analytics.

LCA provides an intuitive framework to make sense of the nonlinear and long SaaS sales cycle with quick insight into the final touch-points before conversions.

Last Click Attribution can be used flexibly with any conversion event in the sales funnel, like

• Demo form signup 
• Marketing Qualified Lead (Newsletter sign up)
• Sales Qualified Lead
• Deals won, and more.

Limitations of Last Click Attribution

The simplicity of the model is what makes Last Click Attribution so attractive, but this simplicity comes at a cost.

The model has some limitations that can impact its accuracy and functionality in certain situations. Here are some of its limitations:

1. Values few channels highly: LCA will highlight channels such as retargeting ads, direct website visit, etc where the conversion is usually high. Due to this marketing teams usually end up allocating more budget on these channels.
2. Disregards contribution of other touchpoints: Last Click Attribution doesn’t account for the possible influence that the other touchpoints could have played in the purchase process.
3. Inaccurate measurement of long-term impact: Not all customers make impulsive buying decisions, at least not in the B2B space. Last Click Attribution does not factor in the long nurturing period in the B2B sales cycle and the various touchpoints that help nurture a prospect.

As the average timeline of the B2B customer journey is increasing, it’s key for marketers nowadays to understand the various factors influencing a prospect's decision.

B2B SaaS companies with long business cycles need to ensure that their efforts are aligned and are contributing to the end goal of converting prospects into paying customers. In this case, the LCA model will give you a skewed perception of the effectiveness of the marketing strategy.

However, these limitations . In the above case, LCA should be used along with other types of attribution models to cover for its shortcomings.

How Last Click Attribution Works in Factors

Last Click Attribution is still used in many B2B SaaS companies where the sales cycle is shorter, and the decision-making process is less complex.

In Factors, you can easily create intuitive Last Click Attribution reports. Additionally the tool presents key metrics such as spend and CPC to help marketers improve budget allocation towards campaigns that work. 

The Cost Per Conversion metric when used along with LCA gives insights into the cost-efficiency of the employed strategy. Marketing teams can use this information to optimize budget allocation for their channels and campaigns to further improve conversions and ROI. 

FAQs

1. Are there other attribution models apart from LCA?

While there are several types of attribution models, the six most common ones apart from LCA are: 

1. First-touch Attribution
2. Last Non-Direct Touch Attribution
3. Linear Attribution
4. U-Shaped Attribution
5. Time Decay Attribution
6. W-shaped attribution

2. Should I use Last Click Attribution for my business?

The decision depends on the specific needs and goals of your business. Last Click Attribution is a simple model, but it is not the  best fit for every company. Consider the limitations of LCA and explore other attribution models and choose the one that aligns with your needs.